Australia's adoption of an international tax regime : to engage or not to engage?

On 1 November 2011 the Minister for Financial Services and Superannuation, the Honourable Bill Shorten MP, announced that Australia would be undertaking a reform of the ‘transfer pricing rules in the income tax law and Australia's future tax treaties to bring them into line with international best practice, improving the integrity and efficiency of the tax system.’ Mr Shorten stated that the reason for the reform was that ‘recent court decisions suggest our existing transfer pricing rules may be interpreted in a way that is out-of-kilter with international norms.’ Further, he stated that ‘the Government has asked the Treasury to review how the transfer pricing rules can be improved, including but not limited to how to be more in line with international best practice.’ He urged all interested parties to participate in this consultation process.

Qualitative and quantitative analysis of six sigma in service organizations

The concept of Six Sigma was initiated in the 1980s by Motorola. Since then it has been implemented in several manufacturing and service organizations. Till now Six Sigma implementation is mostly limited to healthcare and financial services in private sector. Its implementation is now gradually picking up in services such as call center, education, construction and related engineering etc. in private as well as public sector. Through a literature review, a questionnaire survey, and multiple case study approach the paper develops a conceptual framework to facilitate widening the scope of Six Sigma implementation in service organizations. Using grounded theory methodology, this study develops theory for Six Sigma implementation in service organizations. The study involves a questionnaire survey and case studies to understand and build a conceptual framework. The survey was conducted in service organizations in Singapore and exploratory in nature. The case studies involved three service organizations which implemented Six Sigma. The objective is to explore and understand the issues highlighted by the survey and the literature. The findings confirm the inclusion of critical success factors, critical-to-quality characteristics, and set of tools and techniques as observed from the literature. In case of key performance indicator, there are different interpretations about it in literature and also by industry practitioners. Some literature explain key performance indicator as performance metrics whereas some feel it as key process input or output variables, which is similar to interpretations by practitioners of Six Sigma. The response of not relevant and unknown to us as reasons for not implementing Six Sigma shows the need for understanding specific requirements of service organizations. Though much theoretical description is available about Six Sigma, but there has been limited rigorous academic research on it. This gap is far more pronounced about Six Sigma implementation in service organizations, where the theory is not mature enough. Identifying this need, the study contributes by going through theory building exercise and developing a conceptual framework to understand the issues involving its implementation in service organizations.

Are target date funds the easy bake option?

Target date funds provide a simple, automated approach to retirement savings in defined contribution plans. The passing of the Pension Protection Act of 2006 has seen an increase in the popularity of these funds in the United States, becoming the default option for many plans. However, recent research findings have challenged the easy bake or ‘set-and-forget’ nature of target date funds. This study explores some of the critical design features of target date funds (which shifts an individual’s asset allocation from growth to defensive assets following a pre-set glidepath) against a simple balanced (or target risk) fund design. Using both time-weighted and dollar-weighted returns, our results suggest that there is more to achieving successful retirement outcomes than the investor simply selecting a proposed year of retirement. Our findings can perhaps be summarized by Einstein’s famous epithet, that in the murky world of retirement product design, everything should be made as simple as possible, but not simpler.

Learning processes in creative service teams : towards a dynamic systems theory

The fastest-growing segment of jobs in the creative sector are in those firms that provide creative services to other sectors (Hearn, Goldsmith, Bridgstock, Rodgers 2014, this volume; Cunningham 2014, this volume). There are also a large number of Creative Services (Architecture and Design, Advertising and Marketing, Software and Digital Content occupations) workers embedded in organizations in other industry sectors (Cunningham and Higgs 2009). Ben Goldsmith (2014, this volume) shows, for example, that the Financial Services sector is the largest employer of digital creative talent in Australia. But why should this be? We argue it is because ‘knowledge-based intangibles are increasingly the source of value creation and hence of sustainable competitive advantage (Mudambi 2008, 186). This value creation occurs primarily at the research and development (R and D) and the marketing ends of the supply chain. Both of these areas require strong creative capabilities in order to design for, and to persuade, consumers. It is no surprise that Jess Rodgers (2014, this volume), in a study of Australia’s Manufacturing sector, found designers and advertising and marketing occupations to be the most numerous creative occupations. Greg Hearn and Ruth Bridgstock (2013, forthcoming) suggest ‘the creative heart of the creative economy […] is the social and organisational routines that manage the generation of cultural novelty, both tacit and codified, internal and external, and [cultural novelty’s] combination with other knowledges […] produce and capture value’. 2 Moreover, the main “social and organisational routine” is usually a team (for example, Grabher 2002; 2004).

Access to commercial destinations within the neighbourhood and walking among Australian older adults

BACKGROUND: Physical activity, particularly walking, is greatly beneficial to health; yet a sizeable proportion of older adults are insufficiently active. The importance of built environment attributes for walking is known, but few studies of older adults have examined neighbourhood destinations and none have investigated access to specific, objectively-measured commercial destinations and walking. METHODS: We undertook a secondary analysis of data from the Western Australian state government's health surveillance survey for those aged 65--84 years and living in the Perth metropolitan region from 2003--2009 (n = 2,918). Individual-level road network service areas were generated at 400 m and 800 m distances, and the presence or absence of six commercial destination types within the neighbourhood service areas identified (food retail, general retail, medical care services, financial services, general services, and social infrastructure). Adjusted logistic regression models examined access to and mix of commercial destination types within neighbourhoods for associations with self-reported walking behaviour. RESULTS: On average, the sample was aged 72.9 years (SD = 5.4), and was predominantly female (55.9%) and married (62.0%). Overall, 66.2% reported some weekly walking and 30.8% reported sufficient walking (>=150 min/week). Older adults with access to general services within 400 m (OR = 1.33, 95% CI = 1.07-1.66) and 800 m (OR = 1.20, 95% CI = 1.02-1.42), and social infrastructure within 800 m (OR = 1.19, 95% CI = 1.01-1.40) were more likely to engage in some weekly walking. Access to medical care services within 400 m (OR = 0.77, 95% CI = 0.63-0.93) and 800 m (OR = 0.83, 95% CI = 0.70-0.99) reduced the odds of sufficient walking. Access to food retail, general retail, financial services, and the mix of commercial destination types within the neighbourhood were all unrelated to walking. CONCLUSIONS: The types of neighbourhood commercial destinations that encourage older adults to walk appear to differ slightly from those reported for adult samples. Destinations that facilitate more social interaction, for example eating at a restaurant or church involvement, or provide opportunities for some incidental social contact, for example visiting the pharmacy or hairdresser, were the strongest predictors for walking among seniors in this study. This underscores the importance of planning neighbourhoods with proximate access to social infrastructure, and highlights the need to create residential environments that support activity across the life course.

Sequencing risk : the worst returns in their worst order

For the first of the baby boomers turning 65 years of age, after a decade littered with financial shocks (dot.com bubble, sub-prime, global financial crisis, sovereign debt), sequencing risk can represent a significant threat to their retirement nest eggs. This paper takes an outcomeoriented approach to the problem, to provide practical insights into how sequencing risk works and the critical dependency of retirement outcomes on sequencing risk. Our analysis challenges the conventional wisdom that it is the accumulated average of investment returns that matter. We show, instead, that it is the realised sequence of returns which largely determines the sustainability of retirement incomes.

THE quest for alpha : can artificial neural networks help?

The application of artificial neural networks (ANN) in finance is relatively new area of research. We employed ANNs that used both fundamental and technical inputs to predict future prices of widely held Australian stocks and used these predicted prices for stock portfolio selection over a 10-year period (2001-2011). We found that the ANNs generally do well in predicting the direction of stock price movements. The stock portfolios selected by the ANNs with median accuracy are able to generate positive alpha over the 10-year period. More importantly, we found that a portfolio based on randomly selected network configuration had zero chance of resulting in a significantly negative alpha but a 27% chance of yielding a significantly positive alpha. This is in stark contrast to the findings of the research on mutual fund performance where active fund managers with negative alphas outnumber those with positive alphas.

In the shadow of the welfare state : the role of payday lending in poverty survival in Australia

A defining characteristic of contemporary welfare governance in many western countries has been a reduced role for governments in direct provision of welfare, including housing, education, health and income support. One of the unintended consequences of devolutionary trends in social welfare is the development of a ‘shadow welfare state’ (Fairbanks, 2009; Gottschalk, 2000), which is a term used to describe the complex partnerships between statebased social protection, voluntarism and marketised forms of welfare. Coupled with this development, conditional workfare schemes in countries such as the United States, Canada, the UK and Australia are pushing more people into informal and semi-formal means of poverty survival (Karger, 2005). These transformations are actively reshaping welfare subjectivities and the role of the state in urban governance. Like other countries such as the US, Canada and the UK, the fringe lending sector in Australia has experienced considerable growth over the last decade. Large numbers of people on low incomes in Australia are turning to non-mainstream financial services, such as payday lenders, for the provision of credit to make ends meet. In this paper, we argue that the use of fringe lenders by people on low incomes reveals important theoretical and practical insights into the relationship between the mixed economy of welfare and the mixed economy of credit in poverty survival.

Framework of a process laboratory for the operational control of service processes

Service processes such as financial advice, booking a business trip or conducting a consulting project have emerged as units of analysis of high interest for the business process and service management communities in practice and academia. While the transactional nature of production processes is relatively well understood and deployed, the less predictable and highly interactive nature of service processes still lacks in many areas appropriate methodological grounding. This paper proposes a framework of a process laboratory as a new IT artefact in order to facilitate the holistic analysis and simulation of such service processes. Using financial services as an example, it will be shown how such a process laboratory can be used to reduce the complexity of service process analysis and facilitate operational service process control.

Characterising and predicting cyber attacks using the Cyber Attacker Model Profile (CAMP)

Purpose Ethnographic studies of cyber attacks typically aim to explain a particular profile of attackers in qualitative terms. The purpose of this paper is to formalise some of the approaches to build a Cyber Attacker Model Profile (CAMP) that can be used to characterise and predict cyber attacks. Design/methodology/approach The paper builds a model using social and economic independent or predictive variables from several eastern European countries and benchmarks indicators of cybercrime within the Australian financial services system. Findings The paper found a very strong link between perceived corruption and GDP in two distinct groups of countries – corruption in Russia was closely linked to the GDP of Belarus, Moldova and Russia, while corruption in Lithuania was linked to GDP in Estonia, Latvia, Lithuania and Ukraine. At the same time corruption in Russia and Ukraine were also closely linked. These results support previous research that indicates a strong link between been legitimate economy and the black economy in many countries of Eastern Europe and the Baltic states. The results of the regression analysis suggest that a highly skilled workforce which is mobile and working in an environment of high perceived corruption in the target countries is related to increases in cybercrime even within Australia. It is important to note that the data used for the dependent and independent variables were gathered over a seven year time period, which included large economic shocks such as the global financial crisis. Originality/value This is the first paper to use a modelling approach to directly show the relationship between various social, economic and demographic factors in the Baltic states and Eastern Europe, and the level of card skimming and card not present fraud in Australia.

On the relevance of travel journalism : An introduction

Not many people will be instantly familiar with British woman Dale Sheppard-Floyd, but – at least symbolically – she represents a significant milestone in the development of travel and tourism. In fact, the milestone was so significant that the United Nations World Tourism Organization booked Madrid’s venerable Museo del Prado to announce to the world’s media her visit to Spain on 13 December 2012. For Ms Sheppard-Floyd’s arrival for a three-day trip meant that more than one billion times in that year, someone had crossed a border as a tourist. An astounding number, considering that, in 1950, there had been only 25 million tourist arrivals worldwide, and even only two decades previously – in 1990 – the number had been less than half at 435 million arrivals (World Tourism Organization, 2012a, 2012b). While people have traveled for pleasure for millennia (Towner, 1995), tourism really came into its own with the expansion of the middle classes in the 19th and 20th century, and today it is considered the world’s largest business sector, with unprecedented numbers of people venturing outside of their immediate environments to explore the world around them. In 2012, travel and tourism’s total contribution to the world economy amounted to a staggering $6.6 trillion, or 9 per cent of GDP (World Travel & Tourism Council, 2013). More than 260 million jobs were generated by it worldwide, which equates to one in every 11 jobs across the globe. While there were some hiccups during the Global Financial Crisis, growth in 2012 was stronger than in other industries, such as manufacturing, financial services and retail (World Travel & Tourism Council, 2013)...

Revisiting the Australian code of banking practice: Is self-regulation still relevant for improving consumer protection standards?

The Code of Banking Practice is one of the oldest examples of consumer protection provided through self-regulation in the Australian financial services sector. However, since the Banking Code was first released in 1993, the volume of consumer protection legislation applying to banks has increased exponentially and parts of the Banking Code that once provided new consumer rights have now been largely superseded by legislation. In light of the increasingly complex set of laws and regulations that govern the relationship between banks and their consumer and small business customers it could be argued that the Banking Code has a limited future role. However, an analysis of the Banking Code shows that it adds to the consumer protection standards provided by legislation and can continue to facilitate improvements in the standards of subscribing banks and of other institutions in the financial services sector. Self-regulation and industry codes should continue to be part of the regulatory mix. Any regulatory changes that flow from the recent Financial System Inquiry should also facilitate and support the self-regulation role, but the government should also consider further changes to encourage improvements in industry codes and ensure that the implicit regulatory benefits that are provided, in part, because of the existence of industry codes, are made explicit and made available only to code subscribers.

Auditing design and innovation programmes within a multinational insurance provider

The financial services industry is key to the success of the Australian economy, however even established businesses need to continually push to innovate. At present, design is becoming widely accepted as means to innovate and many companies currently have design and innovation programmes. The goal of these programmes is to foster a design capability amongst staff members. However, little is known as to the impact of the innovation capabilities such design programmes claim to instil. Therefore, this paper seeks to investigate how a financial services firm is currently attempting to build a design capability amongst staff members. Using a case study approach the research team audited four design capability programmes currently being deployed by the case firm. The study highlights the strengths and weaknesses of current efforts by the firm and current barriers to achieving design capability. The implications of this paper include key insights for both academics and industry.

Animal Spirits

Animal Spirits is multi-channel video portrait of key personalities involved in the Global Financial Crisis. The four-screen installation displays these twelve decapitated apostles of free-market economic theory in a tableau of droning pontification. Trapped in a purgatorial loop, they endlessly spout vague and obfuscating explanations and defenses of their ideologies and (in)actions. The work takes a creatively quotidian approach to understanding the language of economics and the financial services industry. Through its endless loop of sound, image, and spoken text, the installation examines some of the ideas, narratives and power dynamics that foster and reward hubris and greed.